[ad_1]
Following Preem’s sudden announcement to suspend the Lysekil refinery expansion, DN may now disclose various circumstances regarding the company’s financial difficulties.
Dagens Nyheter has examined Preem’s finances for some time and has found that the company suffers from a lack of liquidity and has been forced to halt a series of investments. As early as last week, DN began asking Preem questions about the financial situation. To a direct question about the future of the expansion at Lysekil, Mattias Backmark, Preem’s head of investor relations, responded:
“Our long-term strategies and climate goals remain the same, despite the pressured economic situation,” in an email.
On a host of other issues, the company has yet to come back.
On Monday morning, the press service stated that they had contact with the board members and the auditor, and that the answers would arrive during the day. At lunchtime, Preem sent out a press release announcing that the entire project at Lysekil would be suspended.
Preem’s refinery in Lysekil.
Photo: Joel Danell
Last year’s sales Preem SEK 84 billion. But profitability has declined in the last three years. In connection with the corona pandemic, the company’s financial situation worsened, according to documents from the Swedish Tax Agency, which DN has read.
To run the business, the oil company has applied for various grants from the state.
According to a decision by the Swedish Tax Agency, Preem was granted a deferral of SEK 1.5 billion for VAT, employer contributions and employee income taxes for the period from January to March this year . In addition, the company has applied for state aid for the adjustment that will help companies in difficulty to cover fixed costs, something that they were denied.
Documents from the Swedish Revenue Agency also show that Preem attempted to recover SEK 1.5 billion in so-called excise duties (taxes on, among other things, energy and carbon dioxide) that it paid for its fuel sales in January and February. .
The company also wanted a deferral of the payment of the corresponding taxes for the month of March of just over 800 million Swedish crowns. In total, Preem sought a deferral of excise duties of SEK 2.27 billion. Preem denies in his written responses to DN that they were rejected:
“They did not reject us, on the contrary, they gave us a tax deferral for all the parts that could be requested and for the full time allowed by the government initiative,” Mattias Backmark wrote at the time.
But what moves If rejected, it confirms both the Swedish Tax Agency administrators and the documents that DN has read.
In his request to the Swedish Tax Agency, Preem referred to the sharp drop in oil prices caused by the global corona pandemic. However, the authority did not consider the arguments sufficient:
“However, it has not shown that its payment problems consist solely of the covid-19 pandemic, but that it is to a not insignificant degree the fall in world oil market prices that has caused its payment problems,” the documents state.
The Swedish Revenue Agency also stated that falling oil prices on the world market is a normal risk-taking in Preem’s business operations.
The documents describe how Preem is trying to save the economy:
“The Preem Group has taken strong measures to strengthen cash flow in the short term and create better profitability in the long term by terminating all consulting agreements in principle, reducing variable costs for everything except production, and pausing or canceling planned investments “.
Excise duties (taxes on energy and carbon dioxide) are not included in the government’s package of measures due to the corona pandemic. Therefore, Preem’s application was examined against the previous law, but the authority considered that the credit risks to the state were too great.
“Their cash flow analysis is based on assumptions that the Covid-19 pandemic will culminate at a certain time and that the market will behave in a certain way, assumptions made with great uncertainty,” the Swedish Tax Agency wrote in its decision.
“The Swedish Revenue Agency’s assessment is that this does not show that it will have the means to be able to reimburse the tax amount after the grace period expires.”
They also write that it is unclear how much of the payment problems stem from the covid-19 pandemic and what proportion comes from falling oil prices on the world market.
Read more:
Preem withdraws its application for expansion at Lysekil
Document: Preemraff: a question of climate and energy
